Warner Bros Discovery’s board rejects Paramount’s bid, backing Netflix merger
Payne Capital Management president Ryan Payne joins ‘Mornings with Maria’ to discuss Warner Bros.’ rejection. Discovery’s aggressive bid for Paramount amid Netflix’s attempt to buy the media giant and more.
The board of directors of Warner Bros. Discovery, Inc. has urged shareholders to reject Paramount Skydance’s aggressive takeover bid, arguing it poses “significant” risks and costs.
The media giant said on Wednesday that its board members had decided that the Paramount Skydance bid was “not in the best interest” of the company or its shareholders, and that they continued to “unanimously” recommend the Netflix merger.
Warner Bros. Discovery agreed to sell its film and television studios and streaming platform, HBO Max, to Netflix in a cash and stock deal worth $27.75 per share, bringing the total to $72 billion, on December 5. Within days of that announcement, Paramount announced an all-cash tender offer to acquire Warner Bros. “top” offers.
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But after reviewing Paramount’s offer, the board said it did not qualify as a “Superior Proposal” compared to the merger agreement the company had already announced with Netflix.
Aerial view of the Warner Bros. logo. shown at the Warner Bros. water tower. Studio on Dec. 5, 2025, in Burbank, Califo. (Photos by Mario Tama/Getty/Getty Images)
In a letter to shareholders, the board also said Paramount’s offer “offers insufficient value and imposes multiple, significant risks and costs.” The board also attacked the deal, saying it misled shareholders by promising that Paramount’s proposed deal had the Ellison family’s “backstop,” meaning a full guarantee to provide all the necessary financing for the deal.
“It does not, and never has,” the board wrote.
Oracle founder Larry Ellison and his son David Ellison successfully took control of Paramount Global after it closed with Skydance Media in August. Warner Brothers’ board said the Ellison family had never committed to fully paying the required financing, meaning Paramount’s proposal had no guaranteed financing.
Warner Bros. Studio in Burbank, CA on Thursday, December 11, 2025. (Myung J. Chun / Los Angeles Times via Getty Images / Getty Images)
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“Although I have been told many times by WBD [Warner Brothers Discovery] how important was the full and unconditional financial commitment from the Ellison family – and despite their ample resources, and PSKY’s many guarantees [Paramount Skydance] during our strategic review process that such a commitment was forthcoming – the Ellison family chose not to withdraw PSKY [Paramount Skydance] to provide,” the board wrote.
In comparison, the board said that the merger of the company with Netflix is a binding agreement with binding obligations, there is no need for any equity financing and strong debt obligations. It is also fully backed by a public company with a market capitalization of more than $400 billion with investment-grade balance sheets, the board said.
In this photo illustration, a man is holding an iPhone that shows Netflix and Warner Bros. it streams apps on its phone screen. (Photos by Anna Barclay/Getty Images)
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Under the terms of the Netflix deal, the streaming platform will buy Warner Bros.’s film and television studios. Discovery and streaming platform, HBO Max. Franchises, shows and movies like “The Big Bang Theory,” “The Sopranos,” “Game of Thrones,” “The Wizard of Oz” and DC Universe will join Netflix’s extensive portfolio.
Netflix said the deal will allow it to significantly expand its US production capacity and continue to increase investment in original content over the long term, which the company says will create jobs and strengthen the entertainment industry.
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But the deal could face regulatory challenges as some lawmakers say the merger would give Netflix greater control over content and distribution.
Last month, Sen. Roger Marshall, R-Kan., sent a letter to the Department of Justice and the Federal Trade Commission saying that the agreement between the two companies will create the largest concentration of content in the history of today’s news, harming consumers, workers and competition in the entire entertainment market.
